Queensland acts on homes shortfall and sets an example for other states
Only a quarter of the way into the federal government’s much-vaunted five-year National Housing Accord, the program is already 80,000 behind the target of 2m affordable homes, according to the Australian Bureau of Statistics.
The government’s quarter time target was 300,000.
Chief executive of Urban Taskforce Tom Forrest says while there are signs housing commencements are picking up, much more needs to be done, essentially by way of a “circuit breaker” in government support for housing-related infrastructure support, and in taxation reform.
“By way of analogy; the quarter time oranges are tasting bitter the fans are restless and the coach is demanding greater effort.
“Clearly, as shown by the gap between actual completions and the National Housing Accord’s own targets, there is a long way to go to deliver the housing supply growth our population needs.”
So, what’s to be done?
Queensland is showing the way with landmark reforms. These are aimed at dealing with a 9% drop in productivity in the construction section sector since 2018 that’s resulted in 77,000 fewer homes being built.
This has happened in no small measure because of bureaucrats’ obsession with red tape, and government indulgence of unions.
The state’s productivity has only increased 5% in the past 30 years compared with a 65% growth in the market economy over the same time span.
An impressive opening gambit with Queensland’s reform has been permanent axing of Labor’s Best Practice Industry Conditions (BPIC). Removal of BPIC from procurement policy is expected to save taxpayers $20.6b.
The Queensland Government has also agreed, or agreed in principle, to 51 of 64 recommendations in the Queensland Productivity Commission’s final report on the state’s construction industry.
These include:
- Removing pre-qualification for subcontractors on government construction projects.
- Reducing administrative burden by removing policies that add complexity to the procurement process and removing barriers to innovation and competition.
- Providing greater guidance on health and safety regulations, including mechanisms for dealing with issues relating to these regulations and right-of-entry provisions.
- Reviewing regulator powers in conjunction with the Wood Commission of Inquiry.
- Introducing a less prescriptive and better targeted policy to boost the number of construction apprentices.
- Reviewing available training courses to ensure skills needed for modern construction are appropriately represented.
- Progressing Queensland’s participation in the Automatic Mutual Recognition scheme and streamlining the licensing process for migrants.
The toll on builders
There’s been a heavy toll on builders doing their best in unnecessarily adverse conditions to stay in business and build desperately need homes.
Macks Advisory is aware of record insolvencies in the building industry and rising mental health concerns among tradies. We know of reports by industry leaders trying to comfort depressed builders in tears, their businesses strangled by government red tape and forced to the point of collapse by non-existent infrastructure.
We understand that of the 1,100 people who in FY2024-25 turned to a national blue collar counselling service for help, 440 were in the building industry.
Latest insolvency statistics from the Australian Securities and Investment Commission (ASIC) show the nation’s construction sector is headed for its second successive year of record insolvencies.
In the past financial year 3,596 building companies collapsed, the worst figure in any 12 months of Australia’s history –1,567 of them in NSW, 1,051 in Victoria -- the states’ two biggest economies -- and 95 in SA.
In the six months from June 30 to the end of December last year another 1,792 of Australia’s building companies were placed into external administration, so that if this trend continues there could well be a new record for business collapses in the sector by the end of the current financial year.
According to Master Builders Australia chief executive Denita Wawn “there is huge concern among industry leadership about the mental wellbeing of our workforce, and if you don’t focus on long-term retention, you can have a problem perpetually”.
SA calls in robots
Meanwhile, SA, exploring all options to ease the building crisis, has given the nation a lead by calling on robots for help. Macks Advisory understands 14 German robots are on their way by ship from Germany to work in a northern Adelaide suburban factory capable of producing six homes a day.
That’s more than 2,000 annually -- a dramatically faster rate than the capability of any conventional home-building company operating in Australia.
